Greek taverna sticker for lower prices.
Visitors to the Greek islands this autumn are advised to look for a special blue sticker when choosing a Greek holiday taverna. The sticker shows that the taverna or cafe have passed on the savings to customers after a substantial drop in VAT which came into effect in August
The sticker is distributed by the Hellenic Confederation of Professionals, Craftsmen and Merchants (GSEVEE) to its members who display their adjusted price lists as proof that they have incorporated the VAT reduction which fell of 23% to 13%.
The confederation represents the owners of thousands of small and medium-sized businesses across Greece.
Greece is following the model that was successful in France in 2009 when the VAT rate in the food service sector was cut from 19.6% to 5.5%.
The 10% hike in VAT on the food sector prompted outrage last year as it forced taverna owners to raise prices and visitors numbers fell.
The Greek government has bowed to pressure to reduce VAT on Greek food services to 13% but has limited it to five months. The rate will go up again next January if revenues fall as a result.
They fear taverna owners could keep prices high and pocket the difference. But restaurant owners complain they have been forced to cut profit margins to a minimum in order to keep prices low and retain customers.
The government insists the VAT rate will stay at 13% for the five-month trial period only and will only be extended if it helps in conquering tax evasion.
French restaurateurs and cafe owners who lowered their prices were rewarded with an official window sticker read 'A cut in VAT is a cut in prices!' The Greek one says 'Lower VAT- Lower Prices'.